The Impact Of Intermediary Business Development On Business Performance Of Commercial Banks

In recent years,with the strengthen of the supervision of financial regulatory authorities,some businesses of commercial banks have been compressed.Foreign financial institutions erode the market of domestic banking institutions.Various Internet financial products diverted a number of customers from banking institutions,during to their high returns and flexibility.The banking industry faces enormous challenges of"internal and external troubles".At the same time,the overall non-performing loan ratio of the Chinese banking industry has risen rapidly in recent years,and the asset quality of the Chinese banking industry has deteriorated.Under these backgrounds,commercial banks are seeking business transformation,which actively try to gradually transform from the traditional "re-asset" business model such as deposit and loan to the "light asset" business model dominated by intermediary business.What is the impact of commercial bank's business performance?Based on this,this paper mainly focuses on a core question:Will the development of intermediary business of commercial banks affect its non-performing loan ratio,and thus affect the business performance of commercial banks?This paper selects the financial annual report data of 106 commercial banks from 2010 to 2017 for a total of 8 years.The system generalized distance(SYS-GMM)model is used to empirically study the impact of intermediary business development on the non-performing loan ratio and business performance of commercial banks.The study found that:1.From the perspective of the whole sample,the increase in the proportion of intermediary business in the total business will improve the business performance of commercial banks.The empirical evidence after the interaction between the intermediary business and the non-performing loan rate NPLR indicates that the increase of the intermediary business ratio can affect the total return on assets or business performance of commercial banks by reducing the non-performing loan ratio of commercial banks.2.The development of intermediary business has significant differences in the business performance of different types of commercial banks.The specific performance is the highest impact on large state-owned banks.The number of joint-stock banks and city commercial banks has decreased in turn,the number of rural commercial banks has been the lowest,and the level of significance has also declined.3.In terms of regions,the degree of influence of the development of intermediary business on the business performance of urban commercial banks and rural commercial banks in the eastern,central and western regions is also quite different.The impact on the eastern commercial banks,central commercial banks and western commercial banks is gradually reduced.However,both were significant at the 1%significance level.The final robustness test shows that the above research conclusions are relatively stable.Therefore,this paper suggests that commercial banks should position their development of intermediate business in a more important position and improve their strategic positioning.Different types of commercial banks should give full play to their own advantages and conduct dislocation competition.Commercial banks in different regions should strengthen communication and learn from each other.